The Disclosure Panacea: A Comparative Perspective on Charity Financial Reporting

This article examines the charity financial reporting regimes of three common law jurisdictions: Ireland, the UK and the US. It assesses whether these respective disclosure models improve either nonprofit behaviour or enforcement odds. Three core aspects of the regimes are reviewed: the reliability of the disclosed information, the consistency of such information and its ability to facilitate comparison between charities, and the level of enforcement arising from disclosure. Particular attention is paid to oversight mechanisms, including audits, and their rates of effectiveness in the regulation of charities. The article examines ongoing efforts to reform broader international accounting standards and considers the impact such moves are likely to have at both regional and national level for charity accountability. It concludes that given the markedly different spheres in which for-profits and nonprofits operate, care should be taken in modelling charity disclosure regimes on those developed for for-profit entities.